Money & Career

How to have a debt-free Christmas

Money & Career

How to have a debt-free Christmas

As much fun as the holidays offer, it can also be a stressful and expensive time of year. It’s never too early to start planning for a debt-free season so you can relax and enjoy the festivities with financial peace of mind.

Some people start shopping for Christmas as soon as the previous yuletide ends; others wait until the last possible minute. Whichever camp you fall into—planner or procrastinator—consider preparing today for a debt-free experience later. Then, come December, when the twinkly lights turn on and the carols are all over the airwaves, you’ve set yourself up for low stress (in terms of finances, anyway). Beginning sooner can increase your sense of control over a potentially costly and chaotic season—remember the old adage that failing to plan is planning to fail. Follow these four steps for a holiday in the black instead of the red.

1. TALK WITH YOUR FAMILY AND FRIENDS NOW

Not in December—to decide how you’d like to spend Christmas. Do you want to stay home and keep things traditional or is this the year to change things up and arrange a trip? Early planning sets expectations and helps avoid last-minute costs.

2. CREATE A MANAGEABLE BUDGET

Once you know what you want to do during the holidays, cost it out. Consider everything, including gifts, wrapping paper, decorations, food, travel, a baby- or pet sitter, parties and clothing. And always add in a bit extra for contingencies. After you’ve figured out how much Christmastime will cost, divide that total by the number of paycheques you have left to receive until Dec. 15, then set up automatic transfers to a savings account so it’s out of your mind. If the pay deduction won’t work for your monthly budget, reevaluate your plans and lower the expenses or find ways to increase your income.

3. MAKE A MASTER LIST OF PRESENTS TO GET

When you’re out and about and see a great deal on a gift for someone on said list, purchase it and transfer the money from your savings to pay off the purchase. A long lead time gives you the opportunity to search for sales.

4. CONSIDER OTHER IDEAS TO SAVE MONEY

Devise a debt-free Christmas by making your own presents (jam, cookies, a book of family recipes), giving homemade gift certificates (for baby­ sitting, snow removal or other services that tap into your talents), agreeing that only children receive gifts, organizing a secret Santa and limiting the amount (say, $25) or donating to a charity as a family in lieu of presents.